USDA put the national average corn yield at 148.1 bu. per acre, just above our current estimate of 147.9 bu. per acre and below the average pre-report trade estimate 148.8 bu. per acre. That put the crop just below the average pre-report trade guess (several are working with harvested acres well below USDA's current estimate of 84.388 million).

USDA's national average soybean yield estimate of 41.8 bu. per acre is 0.8 bu. above the average pre-report trade estimate, but matched the top of the pre-report trade guess range and matched our bean yield estimate. That put the crop at 3.085 billion bushels (rounding makes it different than our estimate of 3.083 billion bushels). This also compares to USDA's Aug. 1 soybean yield estimate of 41.4 bu. per acre. Soybean harvested acres were unchanged from August.

Looking at the state yields, it is a mixed bag compared to August. States showing yield declines include Indiana (down 1 bu., to 42 bu. per acre) and Iowa (down 1 bu., to 51 bu. per acre). States holding steady with August include Illinois (48 bu.), Missouri (39 bu.) and S. Dakota (38 bu. per acre). Yield increases from August were recorded in Arkansas (up 1 bu., to 37 bu.); Minnesota (up 1 bu., to 41 bu. per acre); Nebraska (up 3 bu., to 55 bu. per acre); and Ohio (up 2 bu., to 46 bu. per acre). Obviously, if Nebraska can pull that off, that will be the highest single-state average yield ever seen.

USDA increased harvested cotton acres. To do that, they stepped back to the planting season and increased all cotton plantings by 995,000 acres, to 14.720 million acres. And after increasing cotton plantings by nearly 1 million acres, USDA increased estimated harvested acres just 183,000 from the August Crop Production Report. USDA puts the national average all cotton yield estimate at 807 lbs. per acre, down 15 lbs. from the August estimate.

** 2010-11 U.S. CARRYOVER **

CORN: 920 million bu.; down from Aug est. of 940 million bu.

-- compares to 1.708 billion bu. in 2009-10

BEANS: 225 million bu.; down from Aug est. of 230 million bu.

-- compares to 151 million bu. in 2009-10

COTTON: 2.6 million bales; down from Aug est. of 2.85 mil. bales

-- compares to 2.95 million bales in 2009-10

Old-crop corn carryover was cut 20 million bu. from August and came in 54 million bu. below the average pre-report trade estimate. USDA increased estimated food, seed and industrial (FSI) use 10 million bu. from August, and increased exports 10 million bu. from August to cut carryover 20 million bushels. USDA now puts the national average on-farm cash price at $5.20, compared to the range estimate of $5.20 to $5.30 in August.

Old-crop soybean carryover is down 5 million bu. from August and came in 7 million bu. below the average trade estimate. USDA increased estimated old-crop soybean crush 5 million bushels. USDA now puts the national average on-farm cash price at $11.35, unchanged from August.

Old-crop cotton carryover is down 250,000 bales from August. On the usage side, domestic use was increased 100,000 bales, unaccounted use was increased 170,000 bales (WHAT!) and exports were cut 20,000 bales from August. USDA puts the national average on-farm cash price at 81.5 cents, unchanged from August.

** 2011-12 U.S. CARRYOVER **

CORN: 672 million bu.; down from Aug. proj. of 714 million bu.

BEANS: 165 million bu.; up from Aug. proj. of 155 million bu.

WHEAT: 761 million bu.; up from Aug. proj. of 671 million bu.

COTTON: 3.4 million bales; up from Aug. proj. of 3.3 million bales

New-crop corn carryover is down 42 million bu. from August, but is 36 million bu. above the average pre-report trade estimate. Total supplies are down 442 million bu., the result of the cut to the crop. Total use was cut a staggering 400 million bushels from August, to 12.76 billion bushels. To get there, USDA cut 200 million bu. from feed & residual use (4.7 billion bu.); 100 million bu. from FSA (6.41 billion bu.; all 100 million bu. was cut from corn-for-ethanol use which now stands at 5.0 billion bushels); and 100 million bu. was cut from exports (1.65 billion bushels). USDA puts the national average on-farm cash price at $6.50 to $7.50, up 30 cents on both ends of the range as USDA anticipates higher prices will eventually cut the 400 million bu. in total use.

Soybean carryover is up 10 million bu. from August, and is 13 million bu. above the average trade estimate. Total supplies were increased 24 million bu., the result of an increase in the crop. Total use is now put at 3.161 billion bu., up 15 million bu. from August. That increase is the result of a 15-million-bu. increase in exports (1.415 billion bu.). USDA now puts the national average on-farm cash price at $12.65 to $14.65, up 15 cents on both ends of the range from August.

Wheat carryover is up 90 million bu. from August and is 94 million bu. above the average pre-report trade estimate. Total supply was increased 10 million bu., the result of a 10-million-bu. increase in projected imports. Total use was cut 80 million bu. from August with exports down 75 million bu. (1.025 billion bu.) and food use down 5 million bu. (940 million bushels.) USDA now puts the national average on-farm cash price at $7.35 to $8.35, up 35 cents on the bottom and up 15 cents on the top end of the range from August.

Cotton carryover is up 100,000 bales from August. Total supplies increased by 240,000 from August, the result of a bigger crop. On the demand side, USDA cut 300,000 bales from exports and 40,000 bales from unaccounted use. USDA puts the national average on-farm cash price at 85 cents to $1.05, unchanged from August.

** 2011-12 GLOBAL CARRYOVER **

CORN: 117.39 MMT; up from 114.53 MMT in August

-- compares to 124.3 MMT in 2010-11

BEANS: 62.55 MMT; up from 60.95 MMT in August

-- compares to 68.82 MMT in 2010-11

WHEAT: 194.59 MMT; up from 188.87 MMT in August

-- compares to 193.34 MMT in 2010-11

COTTON: 51.91 mil. bales; down from 52.66 mil. bales in August

-- compares to 43.97 million bales in 2010-11

** 2011-12 GLOBAL PRODUCTION HIGHLIGHTS**

ARGENTINA BEANS: 53.0 MMT; compares to 53.0 MMT in August

-- compares to 49.0 MMT in 2010-11

BRAZIL BEANS: 73.5 MMT; compares to 73.5 MMT in August

-- compares to 75.5 MMT in 2010-11

ARGENTINA WHEAT: 13.5 MMT; compares to 13.5 MMT in August

-- compares to 15.0 MMT in 2010-11

AUSTRALIA WHEAT: 25.0 MMT; compares to 25.0 MMT in August

-- compares to 26.0 MMT in 2010-11

CHINA WHEAT: 117.0 MMT; compares to 117.0 MMT in August

-- compares to 115.18 MMT in 2010-11

CANADA WHEAT: 24.0 MMT; compares to 21.5 MMT in August

-- compares to 23.17 MMT in 2010-11

EU-27 WHEAT: 135.79 MMT; compares to 133.49 MMT in August

-- compares to 135.61 MMT in 2010-11

RUSSIA WHEAT: 56.0 MMT; compares to 56.0 MMT in August

-- compares to 41.51 MMT in 2010-11

FSU-12 WHEAT: 107.45 MMT; compares to 106.62 MMT in August

-- compares to 80.97 MMT in 2010-11

CHINA CORN: 178.0 MMT; compares to 178.0 MMT in August

-- compares to 173.0 MMT in 2010-11

ARGENTINA CORN: 27.5 MMT; compares to 26.0 MMT in August

-- compares to 22.0 MMT in 2010-11

SOUTH AFRICA CORN: 12.5 MMT; compares to 12.5 MMT in August

-- compares to 12.0 MMT in 2010-11

BRAZIL CORN: 61.0 MMT; compares to 57.0 MMT in August

-- compares to 57.5 MMT in 2010-11

CHINA COTTON: 34.0 mil. bales; compares to 33.0 mil. bales in August

-- compares to 30.5 mil. bales in 2010-11

** WHAT ARE THE CALLS? **

Based on this morning's report data, corn and wheat futures are expected to open 5 to 10 cents lower, while soybeans are called to open 10 to 20 cents lower. Macro-economic concerns are also negative.